Cash flows associated with transactions involving long-term creditors are reported in the Financing Activities section of the statement of cash flows.

Question

Quizplus · Accepted Answer

This is correct according to generally accepted accounting principles (GAAP). Cash flows related to long-term creditors, such as payments of principal and interest on loans, are considered financing activities and should be reported as such in the statement of cash flows.

Cash Flows Associated with Transactions Involving Long-Term Creditors Are Reported